Well, there is still some Quake 2 code left in Source, so its not entirely unplausible.
But i am not interested in Valve's words, i am interested in the plausibility of things. Doom 3 was rumored to be on PS2, as did Riddick. There is a cancelled game (Deadlight) that showcases the same dynamic shadowing system as Doom 3 did.. and even some rudimentary HL2esque like physics.
Hence why it would have to be tailor made. Or maybe it would be a Quake 2 PSX kind of situation (Different engine, intermission corridors to connect levels, etc) and still look and play very very similar, but tailor made for the machine.
However, you would also have to require taking into account the Wii controls. For all intents and purposes, Valve was not really like that.
That the Wii was capable is highlight by the numerous CoD ports the thing has. The games look reasonably like their HD counter parts, despite running on tech that's two generations prior in terms of feature set.
I will agree with you on the physics part since its so detrimental to the gameplay. You could pull off something similar that is also dynamic since there are more ways than one to do physics, but you would lose significantly on flexibility.
Graphically, i would have to disagree. Doom 3's uniqueness is in its visual plethora of light and shadow. Not only can a Geforce 2 pull that off by blending textures (Doom 3 on PC even has a specific renderpath for that), you can even pull that off on a Voodoo 1.
The reason it was not used that often is because its a novel approach.
Ill present
Severance, a 2001 game, once more. Not only does it have stencil lights and shadows, it also has a extremely advanced physics engine. You can throw objects and they will interact realistically. Objects will drop realistically off stairs. Your character's weapon will stop its animation when it hits something solid.
Severance, in my opinion, is so impressive, that i made a seperate thread about it some years ago from a different
era. Check it out, if nothing else for the amount of tech prowess it has.